That’s what Elizabeth Warren, chair of the TARP Congressional Oversight Panel said last Monday. ‘œThese loans are concentrated in the mid-sized banks,’ Warren told CNBC. ‘œWe now have 2,988 banks’”mostly midsized, that have dangerous concentrations in commercial real estate lending. As a result, the economy will face another very serious problem — to be resolved over the next three years… [and] things are unlikely to return to normalcy in 2010.”
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commercial real estate
FDIC Forecasts More Bank Closures
One of every 10 dollars a bank holds is in question. Commercial real estate loans are widely viewed to be an area of coming problems, in part because such loans are normally made for periods of seven to 10 years, in anticipation that they will then be rolled over into new loans. Read more about how a regulatory change may help. Read more…
Commercial Market Improvement Will Come Slowly
NAR Chief Economist, Dr Lawrence Yun, predicts high vacancy rates and ubiquitous commercial rent concessions. Slight employment improvements will help absorption rates for office/warehouse space, and SIOR’s (Society of Industrial and Office Realtors) recent survey confirms the forecast of easing in this sector. More than half the members of SIOR® expect an improvement in Q2 2010. Rents are down for Office, Industrial, Retail and Multifamily, but not by as much as in Q4 -2009, and the trends are improving slightly. To read the February Commercial Forecast and table on specifics of four commercial sectors. Read more…
COMMERCIAL PROPERTY VALUE CONUNDRUM – AN OPPORTUNITY
The impact of reduced property values has meant limited refinancing capacity and lending on new purchases will continue to put pressure on commercial real estate values. Yet, with significant equity, it’s simply the best buying opportunity for commercial real estate since 1988/89. Fortunes will be made by some in this market and it’s also a time for property owners to vigorously appeal property taxes. Read more…
NAR Commercial Activism
NAR prepared a letter to Treasury Secretary Tim Geithner and FED Chair Ben Bernanke, urging them to take a more active role in commercial real estate markets because they continue to suffer from a scarcity of credit, ballooning delinquency rates and nearly $1.4 in commercial real estate debt coming due in the next three years. This letter was signed by 79 members of Congress. Is your representative among them?
